PROJECT PRIORITIZATION

This guide describes the approach for setting project priorities for State of Oregon agencieswhen there are competing initiatives and/orthe amount of workthat needs to be done surpasses the resources available to accomplish the work. This document has been developed using current best practices around Information Technology Governance and includes instructions for using a Project Prioritization Matrix.

TABLE OF CONTENTS

Introduction………………………………………………………………………………………2

What Is a Prioritization Matrix? ...... 2

Benefits of a Prioritization Matrix...... 2

Creating and Using a Prioritization Matrix ...... 3

Instruction for Completing a Prioritization Matirx...... 4

Sample Prioritization Matrix...... 5

INTRODUCTION

Many agencies struggle to balance a growing list of new and/or on-going projects whilethe need for providing core services continues, often with less funding. Historically, the State of Oregon has struggled to apply an enterprise perspective in terms of prioritizing information technology initiatives. The task of deciding what to prioritizeand how to define and separate higher priority projects from lower priority projects can be daunting. A structured andobjective approach is helpful in achieving consensus and balancing the needs ofthe agencies, the enterprise, internal government stakeholders, and customers of the State of Oregon. Utilizing a prioritization matrix is aproven technique for making decisions in an objective way.

The enterprise Project Portfolio Management (PPM) tool is designed to capture all majorIT projects in a single, viewable portal. Project ideas are entered at the agency level and subsequently reviewed by Office of the State CIO (OSCIO) Portfolio Managers todiscover whether there are shared service or utility opportunities. Once an agency converts an idea into a project, an IT Investment Analyst will determine if the project requires oversight and at what level of rigor, using anon-Stage Gate or Stage Gate model.NOTE: it is assumed agencies have already run ideas and projects through their internal IT governanceprocess prior to entering them in the PPM system.

WHAT IS A PRIORITIZATION MATRIX?

A prioritization matrix is a tool that provides a way to sort a diverse set of itemsinto an order of importance. It also identifies their relative importance by deriving anumerical value for the priority of each item.The matrix provides a means for ranking projects (or project ideas) based on criteriathat are determined to be important to the Enterprise. For the State of Oregon, this will enable theEnterprise IT Governance Committee (EITGC) to understand whichprojects are prioritized by each agency as the most important in terms of meeting their mission.

Utilizing information from the OSCIO Portfolio Managers and agencies’ Prioritization Matrices, the EITGC will prioritize and recommend the portfolio of IT projects for initiation during a new biennium.

BENEFITS OF A PRIORITIZATION MATRIX

A prioritization matrix supports structured decision-making as follows:

  • Helps prioritize projects when there are multiple importance criteria
  • Provides a quick and easy, yet consistent, method for evaluating
  • Attempts to balance the emotion inherent in the decision-making process
  • Quantifies the decision with numeric rankings
  • Establishes a platform for conversations about what is important/critical
  • Facilitates reaching agreement on priorities across state government initiatives

CREATING AND USING THE PRIORITIZATION MATRIX

The EITGC has created unique criteria and a weighting scale based on strategic value, associated risk, and financial impact. Thisprioritization matrix has been added to the budget instructions for the 2019-21 biennium. Having agencies perform prioritization as a first step will aid in agency IT governance and provide additional,necessary information for those involved making decisions at an enterprise level (EITGC, OSCIO, Chief Financial Office, and Legislative Fiscal Office).

After the OSCIO Portfolio Managers have reviewedthe project information submitted in the PPM tool and the agency prioritization matrices for their portfolio areas, they will provide a summary of their analysis to the EITGC. The EITGC will use the same prioritizationmatrix criteria to score and prioritize projects from an enterprise perspective. A prioritized project list will be compiled, discussed, and finalized by the EITGC. The ELT, inclusive of the State CIO, will evaluate the results to determine the projected resource allocation required for execution of these projects.

The EITGC will monitor progress and review outcomes to ensure the process is providing the intended value. If the criteria being used are not providing the intended value, the EITGC will modify as needed, clearly communicating changesand aligning themwith other project initiation activities and timelines, such as budget requests and legislative activities.

1. Criteria and rating scale.

There are two components involved in rating projects:

  • Criteria for assessing importance
  • A rating scale to assess how well a project satisfies each particular criterion

2. Establish criteria weight.

When a project is scored, the numeric rating given to a particular criterion is multiplied by the criterion’s weight to create a priority score.

Examples:

  • Value to Customer: Weight = 5
  • Required Service/Product: Weight = 5
  • Leverage Potential: Weight = 4

The prioritization matrix itself is a toolintended to capture the best judgement of the people scoring the projects. The EITGC recognizes the diverse needs of state government and as such will give equitable review and consideration to all project requests, regardless of the size of an agency. The EITGC may decide to establish groupings of projects based on natural breaks in scoring (for example high, medium, and low) across different types of projects (agency, shared, or utility OR by Policy Area).

Upon review of the agency prioritization matrices and completion of the Enterprise prioritization exercise, the EITGC will present a recommendation to ELT. ELT may decide that a project needs to move up or down in priority, despite the score it received, due to other factors (i.e. available funding, agency readiness, urgency, and/or competing priorities). These types of adjustments are expected and will eventually help fine-tune the criteria matrix. If an exception is made, it will be justified by the ELT, prior to presenting the final results to the OSCIO, all agency Directors, agency CIOs, the Governor’s Office, Chief Financial Office, and the Legislative Fiscal Office.

HOW TO COMPLETE THE PRIORITIZATION MATIX

For each project reported through the PPM tool, the Agency will complete the following steps:

1)Evaluate the project against the first CRITERION

2)Give the project a RATING appropriate to how well the project fits that criterion

3)MULTIPLY the weight by the rating

4)WRITE the resulting number, i.e., the weighted value, into the box for that project, by criterion

5)Move on to the next criterion. REPEAT ALL STEPS until the project has been assigned weighted values for all criteria

6)ADD ALL VALUES in the column for the project, and place the total in the total Project Score box at the bottom.

Project Prioritization Matrix: Example

CRITERIA / WEIGHT / SCORING VALUE / Project A / Project B
Strategic Value
Required Service/Product-Business Alignment (are any of these are true?)
  • Mandate (legislative, federal or
state)
  • Meets a strategic business need
  • Governor Initiative/Strategy
  • Priority/Compliance for industry
/ 5 / 0,3,6,9
0: none are true
3: one is true
6: two or three are true
9: all are true / 15
Value to Customer
Number of user and the level of positive impact for using the product/service. Consumers or users of the service, product or data. Customer could be citizens, internal agency users, other state/local agencies or other external stakeholders. Or, projects that are funded through grants, IGAs, etc. / 5 / 0,3, 6, 9
0: no value to customer
3: low value to customer
6: medium value to customer
9: high value to customer / 30
Leverage Potential
Multiplier effect:
  • Service/product can be leveraged as a shared or managed service across agencies or policy area
  • Service/product can be leveraged as a utility service
  • Service/product adds value for external partners
/ 3 / 0,3, 6, 9
0: no potential, isolated service
3: low potential
6: medium potential
9: high potential / 0
Risk
Importance to Risk Mitigation
Would the agency, state, or its customer be exposed to a risk or impact if the service or product is not offered? Or, is an existing service at risk? Do other current services/products depend on it? This could be security, safety, legal or any other risk related in loss. / 5 / 0,3, 6, 9
0: no risk to state/ customer if not offered
3: low risk to state/customer if not offered
6: medium risk to state/customer if not offered
9: high risk to state/customer if not offered / 45
Financial
Return on Investment (ROI) / Cost Avoidance
Project ROI reduces cost in expenditures once project becomes a program. Must have a way to measure ROI and the amount of cost that will be avoided due to implementation of the project. / 5 / 0,3, 6, 9
0: ROI none or unknown
3: ROI gained over two biennia
6: ROI gained within two biennia
9: ROI gained in one biennium / 15
TOTAL PROJECT SCORE / 105

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